Devices Orthopaedic Distribution

 News Release - February 6, 2009

Small Bone Innovations, Inc. Consolidates Agreements with Artimplant AB on License, Supply and Distribution of Artelon(R) Spacer Technology

Agreement designed to accelerate introduction of new Artelon applications Creates greater synergies between SBi and Artimplant Increased clinical documentation commitment from Artimplant while reducing SBi development costs

NEW YORK--(HSMN NewsFeed)--Small Bone Innovations, Inc. (SBi, www.totalsmallbone.com), a single-source provider of products, technology and education for the small bone and joint sector of the orthopedic industry, confirmed that it has consolidated five separate agreements into a single new agreement on worldwide license, supply and distribution of Artelon® products with Artimplant AB of Vastra Frolunda, Sweden (‘Artimplant’).

The new agreement addresses the five existing technologies and two applications in development of the Artelon® spacer portfolio designed to treat arthritis within small bone & joints. SBi will no longer own exclusive rights to market and sell spacer products already cleared by the U.S. FDA and certain other products not yet introduced in the U.S. market.

SBi began marketing Artelon products in 2005.

In return, Artimplant has agreed to fund and provide increased clinical documentation on the performance of Artelon spacers, including patient studies. Artimplant will also receive a higher share of margins attributable to SBi sales of Artelon spacers.

Since 2005, approximately 10,000 implants have been performed– principally in the U.S., with a better than 98 percent success rate and less than 1 percent documented explants.

The new agreement consolidating the five separate agreements is retroactive to January 1, 2009. The affected products include: Artelon® CMC-I Spacer, Artelon® CMC Spacer Arthro, and Artelon® STT Spacer, marketed worldwide and the Artelon® DRU Spacer and Artelon® MTP Spacer marketed outside the U.S..

An agreement reached in December, 2007 between the two companies giving SBi exclusive rights to as yet undeveloped Artelon products for treating arthritis in the hands and wrist domain is unaffected by the new agreement.

Anthony G. Viscogliosi, Chairman & CEO of SBi, said: “We are delighted to have consolidated our agreements to create greater synergies between SBi’s marketing and distribution strength and Artimplant’s research, development and manufacturing skills. The new agreement provides increased incentives for both our companies to continue to build the Artelon brand that has already contributed so successfully to the development of our upper limb portfolio in the U.S.”

He added that the new agreement will “enable SBi to focus its resources on expanding market acceptance for the Artelon technology to all the joints and bones in and around the thumb, fingers, hand and wrist, as well as a lower limb application being developed in Europe. As a resurfacing material, Artelon implants are minimally invasive, tissue sparing, and bone preserving as an early-stage treatment for osteoarthritis in the base of the thumb.”

The company has trained more than 1,200 hand surgeons and has over 850 surgeon users of Artelon spacers. The company estimates that U.S. surgeons perform up to 40,000 LRTI and fusion procedures annually on arthritic thumbs.

SBi first licensed the Artelon technology in 2004 and began marketing applications in the US in 2005 with the Artelon® CMC-I (carpo-metacarpal) spacer to treat early to mid-stage osteo-arthritis (OA) in the base of the thumb.

Artelon® is a registered trademark of Artimplant AB

For more details on Artelon products marketed by SBi, visit: http://www.totalsmallbone.com/products/artelon.html

About Small Bone Innovations, Inc.

Small Bone Innovations, Inc. (SBi) was founded in 2004 by Viscogliosi Brothers, LLC, (VB), a New York-based merchant banking firm that specializes in the musculoskeletal/orthopedic sector. VB created Sbi as the first company to focus purely on small bones & joints. By integrating established companies and professionals in the field, Sbi offers a broad, clinically proven portfolio of products and technologies to treat trauma and diseases in small bones & joints. Today, Sbi has more than 140 employees worldwide.

For more information on Sbi, please visit: www.totalsmallbone.com

About Viscogliosi Bros., LLC

Established by Marc R. Viscogliosi, John J. Viscogliosi and Anthony G. Viscogliosi in New York City in 1999, Viscogliosi Bros., LLC (VB) was the first venture capital/private equity and merchant banking firm dedicated exclusively to the musculoskeletal/orthopedics sector of the health care industry. As principals of VB, the Viscogliosi Brothers have a combined total of nearly half a century of experience analyzing and investing in the musculoskeletal/orthopedics sector.

VB’s mission is to create, build and finance companies founded on innovations developed by surgeons and uniquely focused on “life changing” musculoskeletal/orthopedic technologies. VB has worldwide surgeon, industry and trade relationships, and significant financial expertise in the musculoskeletal/orthopedic sector.

The brothers have pioneered more than 170 financial, strategic and management initiatives for companies in the musculoskeletal/orthopedic sector, from start-up, seed and development stage all the way to exit. These initiatives have helped people live better lives through the orthopedic and spinal products developed, marketed and sold by the companies VB has assisted in developing and financing.

For more information about VB, please visit: www.vbllc.com

About Artimplant AB

Artimplant is a biomaterials company focused on solutions to problems in orthopaedic and oral surgery. Artimplant restores health through the development, production and marketing of degradable implants that regenerate body functions and improve quality of life. The products, made from Artelon®, meet unmet clinical needs and are marketed in a growing number of therapy areas. Artimplant produces implants for treatment of osteoarthritis in hands and feet, for shoulder and other soft tissue injuries, as well as oral surgery and veterinary medical applications.

Artimplant is a public company listed on the OMX Nordic Exchange Stockholm in the Small Cap segment and in the healthcare sector.

Forward-looking statements

This press release contains forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of risks and uncertainties impacting Sbi’s business including increased competition; the ability of Sbi to expand its operations and to attract and retain qualified professionals; technological obsolescence; general economic conditions; and other risks.

Source: Small Bone Innovations

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